Looking for some practical advice re: recent 1/11 real estate transaction.

My husband and I just bought a 1200 sf rancher built sometime in the fifties with the intention of adding second story, and finishing the basement. When we initially looked at the house, the basement was freshly dry-locked(should've been our first clue), and a sump pit existed on one side of the bm. It is a walkout bm on a sloped lot. The sellers told us the previous owners(2005)had reported some dampness in basement, but they had not experienced any water issues. We pressed the issue several times over email, but they responded repeatedly that there was only "some dampness".

A few weeks after we moved in , we had a full perimeter french drain installed with 2 sump pits, because our plan is to use it as living space. During excavation of perimeter, we were shocked to see the entire trench filled with at least 6 inches of water. The installer, who is familiar with the neighborhood, told us the water table is VERY high here. Our sumps have gone off several times each hour since they were installed last month, sometimes as much as every 5-10 min.

We spoke with or neighbor last week who informed us that previous owner DID INDEED have a large flood incident last year, losing everything in the basement. He insists they sold the house because of water issues. He is willing to testify to that.

Obviously, the seller is in the wrong. We have sent them notice through our attorney that they have not escaped this transaction unscathed. I do not wish to turn this into a long legal battle, although my husband is beyond angry. I want to know that I can have piece of mind re: condition of foundation, which has been subjected to water intrusion for so long without proper drainage. Is it stable enough to hold up 2nd story addition? How do I know the current french drains will keep up with all the water during winter thaw and rainy season? Can this house still be what we envisioned it to be (for the next 15 yrs)?

So, here is my question:

What do you think the best way to proceed?

Do I hire a civil engineer to survey property?

Rely on the lifetime warranty the (reputable)waterproofing company gave us and hope for the best?

What would you do?

Thanks for your input.